Providing perspective on the economics and politics of sports business in Florida...and the Rays' campaign for a new stadium in Tampa Bay.

Wednesday, February 18, 2015

Previewing St. Pete's City Council Workshop

The Times' Stephen Nohlgren previews a number of the difficult-to-pin-down economic impact questions St. Pete's city council will discuss tomorrow morning in their "we won't let you look in Tampa, but we'd still like you to look over here" workshop.

An excerpt:

The Rays employ about 300 people year-round, adding another 1,000 on game days.According to Forbes magazine, the team earned $181 million in
2014, most of which came from outside St. Petersburg. Media contracts
and communal Major League Baseball dollars provide the bulk of the Rays'
income. Even the majority of fans come from outside Pinellas County.Compared to the impact of other industries, however, little of that
Rays' income spreads through the local economy, said Stan Geberer,
senior associate at Fishkind & Associates, an Orlando economic
consulting firm...."Probably 85 per cent of revenues generated (by the Rays) have zero economic impact on St. Petersburg,'' Geberer said....Sports bring psychic value, Geberer said. "It makes people feel good about their city.''But if economic impact is all that counts, then St. Petersburg should
invite the Rays to leave, he said. Almost any successful mixed-use
development at the Trop "would well exceed any economic impact of
sports.''

1. How much public money are they willing to spend on a new stadium? A modern baseball stadium likely would cost at least $500 million. The Rays would have to make a significant contribution, and the county's resort tax would have to continue to help pay for a stadium. But to raise a half-billion dollars or more, the city probably would have to steer more public money than the roughly $6 million a year it has been paying on Tropicana Field bonds.

If council members don't want to spend as much as St. Petersburg does now on a baseball stadium, let alone more, it would be good to know that now.

2. Where should a new stadium be located in St. Petersburg? One of the city's advantages is that it controls 85 acres where Tropicana Field sits, and a new stadium could be built in the parking lots to the east of the dome. Some council members were disappointed that the Rays did not take a serious look at a private proposal to build a stadium in Carillon office park on the city's northern edge. Council members should discuss whether a new stadium should be downtown or whether other locations could work.

3. Would there be better uses for the Tropicana Field site? Those 85 acres could be very attractive to a developer who could use the blank slate to design a mix of retail, housing and business headquarters that would open up all sorts of new opportunities. The site would be worth tens of millions, and the potential to expand the city's tax base would be significant. Another option: Pursue more modest development and create a grand public space of parks and amenities that would complement the city's waterfront parks.

4. What is the potential economic impact for a new baseball stadium? The economic impact of the Rays playing at the Trop is difficult to measure but conservatively estimated to be in the tens of millions of dollars each year. Around the dome, major-league baseball has not triggered as much redevelopment as many baseball supporters envisioned when the City Council voted in 1986 to build the stadium. But there are examples around the country of new stadiums planned or built that are part of larger developments, such as the new suburban home planned for the Atlanta Braves.

5. What should be the city's role after the Rays start looking at stadium sites? Before opening day in April, the mayor expects to present to the City Council a revised agreement that would enable the Rays to look at potential sites in both Pinellas and Hillsborough counties. The council voted 5-3 against an earlier agreement in December because of concerns about development rights at the Trop before the Rays left, and a new version is expected to address those concerns. The Rays reasonably maintain they have to look throughout their core market for the best site, and the council should have approved an agreement to let them do that before scheduling this morning's discussion. But as long as they are talking, council members should discuss if and how they would like the city to be involved when the Rays actually start looking for a new home.

1 comment:

The Tampa Bay Times possesses no expertise in the area of law or public policy. It is just a newspaper. People should heed legal advice from a newspaper as much as they heed medical advice from a plumber. The value, if any, of the paper's lay opinions continues to decline. Of all the stadium developments to cite, why point to the sham process in suburban Atlanta as evidence of a success? It's almost like they've stopped bothering to research anything, let alone develop an opinion of any value. At least the paper is open about wanting the city to give away a legal position in exchange for nothing. Something for nothing. This isn't the first time that the paper has favored handouts of other people's money. Committing other people to give away something of value takes so little thought or effort. Just as the Rays "reasonably maintain they have to look throughout their core market," the City reasonably expects to get paid by the Rays for the right to do that. Right, let's take business advice from a newspaper. These big decisions should be made without regard for the petty emotions of the legacy news industry. The stakes are too high. http://articles.orlandosentinel.com/1988-04-10/news/0030200143_1_tampa-bay-area-petersburg-stadium/2